Pardon me while I step aside to avoid the Schedule C bandwagon.  Contractors do work for other people.  Who did he contract with, on this property?  Does he have a history of flipping fixer-uppers?  

A garage owner sees a great deal on a 69 'Cuda.  Buys it, does a tune-up and sells it for a profit.  Does that make her a car dealer?  

IRS spends millions these days trying to prove that people don't have self-employment income.  Sure, they only do it when EIC or CTC is involved, but let's shine that light on it.  Did he 1099 the people who did the work?  Or did he do himself, the work that he usually hires out?  How involved was the wife?  More than with other aspects of the business?

How much contracting work did he have last year?  Some people lost business to Covid, while others saw their business prosper.  If his Schedule C business was dormant, don't tax him for choosing a Schedule D alternative.